Copyright 2001 Boston Herald Inc.  
The Boston Herald
May 21, 2001 Monday ALL EDITIONS
SECTION: FINANCE; Pg. 029

LENGTH: 601 words

HEADLINE: CAPITAL FOCUS; FCC head shows moderation, sense

BYLINE: By Ted Bunker

BODY:
Conservatives and liberals alike might have been surprised to hear FCC Chairman Michael Powell voice heartfelt support for the e-rate program and broader universal service subsidies.

A Republican, Powell has made no secret of his market-friendly sentiments on a number of issues, from broadcast media ownership limits to ways of forcing open monopoly markets.

But on Thursday, Powell judged the program aimed at providing low-cost Internet access to schools, libraries and other nonprofit institutions "an extraordinary success."

Powell measured that success by noting that 95 percent of all American schools, and 63 percent of all their classrooms, now have Internet access. His comments came at a Senate confirmation hearing on his nomination as Federal Communications Commission chairman.

"I think it's fair to say that the e-rate program was a substantial engine that fueled that development," he told Sen. Jean Carnahan (D-Mo.). Carnahan was among several senators who questioned Powell's support for continuing the $ 2.5 billion-a-year subsidy.

A move by the White House to put some teacher training costs and other items under the e-rate program - financed by a charge on consumer phone bills - gave rise to concern. Powell said when it comes to setting policy of that sort, he would defer to Congress and the president.

On other issues, including questions about media concentration and diversity, Powell also gave more moderate answers than expected, judging by the tone of some questions.

"What concerns me is if I look at all of your inclinations in terms of what I've seen in print, on your watch we could perhaps have the most radical consolidation of media ownership in the country's history," said Sen. Ron Wyden (D-Ore.).

While suporting the goals of limiting media ownership concentration, and of maintaining a diversity of media voices, Powell pointed out that some related rules may be hopelessly out of date.

"Maybe these rules will be validated in the context of a fulsome examination of the current media marketplace," Powell said. "I'll say publicly, if that case can be demonstrated . . . and if the rule continues to serve that purpose, then it will be maintained."

One such rule Powell has publicly questioned prevents a broadcaster or newspaper owner from owning both sorts of media in the same community - called the cross-ownership ban. It has been assailed as a violation of First Amendment rights.

Noting a congressional mandate to review ownership restrictions every two years, Powell told Wyden that the courts have eroded those rules in the absence of FCC action. Congress mandated the biennial reviews in 1996, but so far the FCC has put off taking up the 1970s-era ban.

The ban has undermined some major newspapers. It has been blamed for shutting down the Washington Star and threatens to force the sale or shutdown of the New York Post as its owner, Rupert Murdoch's News Corp., seeks to buy a second VHF television station serving New York.

Murdoch, who won a waiver to let him buy the Post without selling the Fox network's Channel 5, has indicated that the Post's rocky finances would make it unlikely to survive on its own. And he has argued that he couldn't get a fair price for it.

New York, like Boston, is one of a few remaining cities in America with more than one daily newspaper. In the past decade, however, as UHF and cable-only TV took hold, New York lost one daily, New York Newsday. Now another of its remaining three papers could fold - a disaster Powell and his FCC should prevent.

Talk back to Ted Bunker at bostonherald.com.



LOAD-DATE: May 21, 2001